The Audit Committee makes recommendations to the Board of Directors regarding the auditors’ performance and submits recommendations regarding auditor’s fees to the Nomination Committee. It reviews the scope and execution of audits performed (external and internal) and analyzes the result and the cost.
The Audit Committee has established pre-approval policies and procedures for services other than audits performed by the external auditors. For other matters, an auditor submits an application to the CFO. If supported by the CFO, the application is presented to the Audit Committee for final approval.
Pre-approval authority may not be delegated to management. The policies and procedures include a list of prohibited services. Such services fall into two broad headings:
- General pre-approval services can be pre-approved by the Audit Committee without consideration to specific case-by-case service. Tax, transaction, risk management, corporate finance, attestation and accounting services and general services have received a general pre-approval of the Audit Committee, provided that the estimated fee level for the project does not exceed SEK 1 million. The external auditors must advise the Audit Committee of services rendered under the general pre-approval policy.
- Specific pre-approval – all other audit-related, tax and other services must receive specific pre-approval. The Audit Committee Chairman has the delegated authority for specific pre-approval, provided service fees do not exceed SEK 2.5 million. The Chairman reports any pre-approval decisions to the Audit Committee at its scheduled meetings.
